Wide band gap (WBG) semiconductors require packaging with reduced parasitic inductance and capacitance. To achieve this, new packaging solutions are proposed that increase integration. This causes difficulty in measurement of voltages, currents, and device temperature, and therefore, designers must rely more heavily on simulations to gain insight in the operation of the developed prototypes. Additionally, the use of the digital design may reduce the number of physical prototype iterations, and thereby, reduces the development time. Gaining fidelity of three-dimensional multiphysics simulations, reduced order modeling, and system simulation aids in the design of working prototypes and pushes performance of new power modules based on WBG semiconductor devices. This article provides an overview and discusses the recent advances in the use of finite-element analysis and simulation tools within the topic of power module packaging. The main aspects covered are extraction of electrical parasitics, simulation of transient thermal response, and issues related to evaluation of electric fields. An example of a simulation software roadmap is presented that enables accurate electro-thermal simulation of new packaging structures that combine the conventional power module technology with integrated printed circuit boards. The future challenges for utilizing the potential of the digital design are discussed.